Pubs and clubs in Sydney's most popular entertainment districts will be hit with a 3am alcohol curfew - and harsh mandatory sentences for drunken attacks will be introduced within weeks under radical reforms to drive down violence.

But the hotel industry warned that the crackdown announced by Premier Barry O'Farrell would damage the ''night-time economy'' and legal experts condemned the mandatory sentencing as a ''knee-jerk response''.

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Under measures announced on Tuesday, dozens of late-trading venues in central Sydney will have to lock out new customers from 1.30am and cease alcohol service from 3am.

The rules will apply to venues within a new precinct stretching from Kings Cross to Cockle Bay, The Rocks to Haymarket and Darlinghurst.

The only exempt venues will be small bars with a capacity of fewer than 60 patrons, restaurants, and bars within ''tourism accommodation'' such as large hotels.

A system of periodic liquor licence fees based on risk will be introduced in NSW, and bottle shops will have to close by 10pm.

The package includes mandatory minimum sentences for a range of violent crimes involving drugs and alcohol. They include new ''one-punch'' laws, which will have a mandatory minimum sentence of eight years' jail for fatal assaults where drugs or alcohol are a factor - and a maximum penalty of 25 years' jail.

Mandatory minimum sentences and increased maximums will apply to a range of other crimes such as sexual assault, affray and assault causing actual bodily harm when alcohol or drugs are involved.

Police will be given powers to test violent offenders for drugs and alcohol and intoxication will be removed as a mitigating factor in sentencing.

Legislation for the sentencing changes will be introduced next week and the government expects to have them in place by February 1. Mr O'Farrell said he hoped the new trading laws would be operating by the end of April and would be independently reviewed in two years.

''This is not about penalising responsible drinkers,'' he said. ''It is about attacking the irresponsible acts of those who allow themselves to be intoxicated, whether by drugs or alcohol.''

The new licensing restrictions will be additional to those already in place for pubs and clubs on the violent venues list or subject to the Kings Cross plan of management.

The announcement followed weeks of pressure for the government to respond to community concern over alcohol-fuelled violence, including the death of 18-year-old Daniel Christie, who was assaulted in Kings Cross on New Year's Eve.

Mike Daube from the Public Health Association of Australia said the measures might ''be a turning point in changing the binge-drinking culture'' and would ''do much to reduce alcohol harms in both the short and long term''.

But Dr Alex Wodak, emeritus consultant with the drug and alcohol service at St Vincent's hospital, said the licensing measures didn't go far enough and should be implemented statewide.

A spokesman for the NSW/ACT Alcohol Policy Alliance, Michael Thorn, described them as ''strong and effective preventive measures'' and congratulated Mr O'Farrell for ''his willingness to stand up to the alcohol industry''.

Campaigner Tony Brown, who has agitated for Newcastle-style lockouts and trading hours for Sydney after helping achieve them in his home town, said the result was ''monumentally positive''.

The NSW branch of the Australian Hotels Association welcomed the sentencing changes but said lockouts and the 3am alcohol service restriction would have an undeniable impact on the night-time economy, penalising businesses that are well run and have had nothing to do with the recent violence''.

The president of the NSW Bar Association, Phillip Boulten, said mandatory sentencing was a one size fits all form of justice, which failed to take account of the circumstances of each case.

''The government's suite of practical measures aimed at reducing the availability of alcohol on our streets is the appropriate response to the problem of alcohol-related violence, rather than the knee-jerk changes to the criminal law that have been tagged on to the package,'' he said.

Opposition Leader John Robertson welcomed the announcement but said Mr O'Farrell should scrap the exemption on lockouts for small bars, restaurants or bars within accommodation hotels.

Greens MP John Kaye criticised the government for not preventing the continuing opening of bottle shops owned by retailers Coles and Woolworths.